Tag: discounted oil

  • Pakistan receives second shipment of discounted Russian crude oil

    Pakistan receives second shipment of discounted Russian crude oil

    On Tuesday, the second shipment of discounted Russian crude oil, comprising a total of 55,000 tonnes, reached the Karachi port.

    The vessel carrying Urals oil, named ‘Clyde Noble’, had been en route to the port of Karachi in the Arabian Sea, according to earlier reports from reliable sources. Once the ship’s berthing plan is finalized, it will be docked at the oil pier.

    An insider from the oil industry had previously informed The News that the vessel was expected to reach Karachi Port by Tuesday. Originally scheduled to arrive on June 20, the second cargo faced a one-week delay due to limited storage space in the tanks of Pakistan Refinery Limited (PRL).

    The PRL, being the first domestic refinery to receive crude oil from Russia under the government-led deal, encountered logistical challenges.

    Pakistan had received its initial shipment of Russian crude oil on June 12 when a tanker carrying 45,000 tonnes of crude oil docked at the Karachi port. The government had placed an order of 100,000 tonnes of Russian crude oil in April of this year after months of negotiations with Moscow to finalize the terms and conditions of the agreement.

    As per the terms of the deal, Russia dispatched the first oil tanker carrying 100,000 metric tonnes of crude, which arrived at the Omani port earlier this month.

    However, due to the Pakistani port’s limitations in handling heavy ships carrying over 50,000 tonnes of oil cargo, it was decided to transport the crude to Pakistan using smaller vessels.

    It is noteworthy that the vessel, loaded with Ural crude on April 21 at a Russian port, faced a 10-day delay due to technical issues. Subsequently, it reached Egypt’s Suez Canal on May 17, where it endured a 12-day wait in a lengthy queue before crossing the canal.

    Currently, Pakistan imports 70 per cent of its crude oil, which is refined by PRL, National Refinery Limited, Pak Arab Refinery Limited, and Byco Petroleum. The remaining 30 per cent is domestically produced and refined by Attock Refinery Limited.

    To meet the demand for petroleum products, PRL is presently in the process of refining the Russian crude oil, blending it with Arabian crude that arrived a few days ago following a PRL order.

  • Pakistan will start importing crude oil from Russia in March

    Pakistan will start importing crude oil from Russia in March

    Pakistan and Russia have decided on the deadline for crude oil exports in late March after the conclusion of the annual inter-governmental commission between the two countries concluded.

    The Minister of State for Petroleum, Musadik Malik, said that Pakistan intends to import 35 per cent of its entire crude oil needs from Russia. He added that Russia does not have liquefied natural gas (LNG) for Pakistan currently.

    Russian Energy Minister Nikolay Shulginov also stated that Pakistan will pay for its energy purchases from Russia in the currencies of friendly nations when they begin in late March.

    Last year, the government of Pakistan sent representatives to Russia, and as a result, the state minister for petroleum of Pakistan announced that Russia would supply crude oil at a reduced price.

    Russian oil and gas have not historically been widely imported by Pakistan.

    Islamabad and Moscow agreed during the negotiations that the oil and gas trading transaction will be set up such that both nations can profit economically after reaching an agreement on the technical details.

    The leaders also decided to expand energy infrastructure investment, improve energy trade, and strengthen energy cooperation under advantageous strategic and commercial circumstances.

    A “Comprehensive Plan for Energy Cooperation” that will serve as the framework for future work and be completed in 2023 has been agreed to by both parties.

    The federal and provincial governments of Pakistan welcomed the Russian side to consider prospective initiatives, including those involving public-private partnerships and asked the Russian businesses to investigate these options.

    “Both sides have resolved the pending issues related to the exchange of information on certificates of origin of goods with the use of an electronic verification system and shall endeavour to finalise the above-mentioned protocols by the end of May 2023,” the joint statement issued in this regard read.

    In order to improve their mutual collaboration and talk about issues pertaining to connectivity and logistics in Central and South Asia, the authorities decided to designate focus points for each side.

    It was also resolved at the talks held over the last three days that creative business practises, such as bartering, would be used. They also agreed to further investigate the possibility.

    “In the context of the desire of both parties to promote regional integration and Eurasian connectivity, the two sides agreed to share information towards developing and improving rail and road infrastructure,” the statement read.

    The documents signed during the session included an “Agreement regarding cooperation and mutual assistance in customs matters,” a “Protocol on the Exchange of Documents and Data on the Customs Value of Goods Transported,”  and a “Working Agreement on the Airworthiness of Aeronautical Products.”

    The seventh IGC’s debates and choices served as the foundation for the eighth session, which moved the process ahead and looked at new possibilities for collaboration.

    Additionally, Pakistan and Russia decided to extend their cooperation in the areas of commerce and investment, energy, communication, transportation, higher education, industry, railroads, banking, finance, customs, agriculture, science, and technology.

  • Russia to sell cheap crude oil to Pakistan, Musadik Malik reiterates

    Russia to sell cheap crude oil to Pakistan, Musadik Malik reiterates

    State Minister for Petroleum Musadik Malik on Friday reiterated that Russia will provide Pakistan with crude oil at discounted rates.

    Speaking at a press conference, Malik claimed that Russia will offer Pakistan crude at a discount, just like the energy giant does for other nations across the globe.

    “It (the discount) could be greater than what others receive,” he added. 

    The remarks come a day after PBS Newshour journalist Amna Nawaz interviewed Foreign Minister Bilawal Bhutto-Zardari, who said: “As far as Russia is concerned, we aren’t pursuing or receiving any discounted energy, but we are facing an extremely difficult economic situation.”

    In response to a question on the $60 per barrel limit on Russian seaborne oil imposed by the Group of Seven and the EU in connection to Russia’s war in Ukraine, Bilawal said, “Up until now we actually haven’t received nor are we getting any oil from Russia.”

    “As far as discounted rates, no one is giving discounted rates for oil these days,” Bilawal also told reporters at the United Nations. “That’s not a reality. It is true that we’re actively pursuing ways and means to address the energy shortfalls and difficulties we’re facing in Pakistan.”

    Malik, who had earlier in the month claimed that Russia will supply cheaper oil, revealed on Friday that Pakistani refineries could process Russian crude, namely Siberian Light and Ural Light. Islamabad’s inability to obtain oil from Moscow is attributed to Pakistan’s refineries’ capacity to handle Russian crude.

    “Pakistan Refinery Limited (PRL), owned by Pakistan State Oil (PSO), told us that they could utilise up to 50 per cent light crude of Russian origin. Similarly, PARCO has told us that they could utilise up to 30 per cent of Russian crude.”

    “Whereas, Cnergyico, the third largest oil refinery in the country, could not only process these two (Siberian Light and Ural Light) crudes but also heavy crudes as well.”

    “We will get these light crudes from Russia on a discount,” added Malik.

    Discounts on finished goods, such as gasoline and petrol, will also be discussed, the state minister added. The Russian delegation is expected to visit Pakistan in 2023.

    According to DAWN, in the second week of January, there will be an Inter-Governmental Commission (IGC) meeting between Pakistan and Russia. During the conference, the Russian energy minister is likely to visit.

    In connection to the TAPI project, which “may offer us with 1.3bcf of gas,” Malik continued, the administration has also reestablished contacts with Turkmenistan.

    “A special strategic cell has been established in the Ministry to follow up these projects,” he said.

    On liquid natural gas (LNG), Malik said the government is working with Azerbaijan on a gas purchase framework agreement, which is being drafted. “Under this framework, we would have a government-to-government level agreement with the State Oil Company of Azerbaijan Republic, largely known as SOCAR,” he said.

    “SOCAR will provide us with distressed cargoes on a monthly basis, and the Government of Pakistan would have the option to purchase these cargoes at given rates or not. “This will help us increase our gas supply,” he said.

    The minister said that SOCAR has already offered Pakistan LNG cargo for December 14. “However, we were unable to purchase it as both our terminals were not available,” he said.

    Additionally, the government is still working to come to an arrangement with the UAE that would allow for the purchase of diesel and petrol cargoes.

    “I want to reiterate that the policies of the current government are meant to alleviate hardships of poverty-ridden masses,” said Malik.

    He said that despite a 10 per cent yearly loss in gas reserves, the government is giving its people more gas this year than it did the year before. ”We will have an additional cargo of gas in the coming months of January and February, in comparison to the same period in 2022,” he said.

    “We are also bringing in 20,000 tons LPG in addition to facilitate our consumers.”